PNG – Dump Their Forum & Focus on Our MSG

Who owns the Pacific Islands’ Forum? That was the question Dr Roman Grynberg poised in Part 1 of a four-piece weekly special report published in last week’s PC’s Weekend Courier and also carried in the Fiji Times Online. It’s a question that needs to be seriously addressed by the PNG Government (and the rest of the Forum) because at the center of the issue lies a series of factors that will have dire consequences, particularly Australia and NZ’s trade agenda in the Pacific region, if the region’s governments doggedly follow the bone.

If you haven’t read Dr Grynberg’s special report, he essentially argues in Part 1 that the regional policy coming out of the Forum is biased policy – prepared, produced, promoted and pressured onto the rest of the Forum Members by the two white-minority power-brokers of the Forum – Kevin Rudd’s Australia and John Key’s New Zealand.

Dr Grynberg puts forth a few reasons as to why this has been happening substantially long enough that the ownership of the Forum, and therefore, its credibility and ultimately its existence, is now questionable – whose agenda is the Forum pushing?

The most clear example of the extent of Australia and NZ’s ownership of the Pacific Islands Forum is their aggressive introduction and pursuance of establishing a ‘free trade’ deal among member countries of the Forum. Dr. Grynberg made the point of witnessing “Pacific island ministers and officials sit and agree to policy that they know is not in their country’s interest” because they are scared of repercussions – backlash from the two power-brokers of the Forum who are not only members, but who are also the Forum’s and region’s main aid-donors!

Now I’m not too sure what the founding fathers of the Forum had in mind when they allowed Australia and NZ to become members – but that mistake has no doubt negated the purpose of the Forum and the ‘Pacific Way‘. Where is the consensus in solving the problems of our region when the policy coming out of the Forum is biased? Those in lobbying understand that the greatest chance one has in affecting decisions to swing in one’s favour is to strike early – to influence the actual policy itself when it is in its infancy stages long before it hits the agenda. And if the policy being churned out of the Forum is coming directly from officials sitting behind desks in Canberra and Wellington – what chance do we have?

We may as well scrap the Forum and ask Canberra and Wellington to save theirs and our taxpayer’s money and email their policies direct to Port Moresby, Suva, Apia or Nuku’alofa! Indeed, it staggers me that so many of our Polynesian and Micronesian neighbours in the Pacific have allowed themselves to become so entangled within the net of neo-colonialism.

For example, just have a look at what currency countries of the Pacific use: Guam, Northern Mariana Islands, American Samoa, Palau, Federated States of Micronesia, East Timor and the Marshall Islands are currently using the US Dollar. Nauru, Kiribati, and Tuvalu use the Australian Dollar, and Tokelau, Cook Islands, Niue, and the Pitcairn Islands use the NZ Dollar. Throw in the CFP Franc that is used by New Caledonia, Wallis and Futuna, and French Polynesia, and tell me, who owns the Pacific?

One section of the Pacific that still use their own currency is Melanesia. The Melanesian states comprise 85% of the Pacific island population and the lion’s share of the region’s natural resources. On March 26, 2007 the Melanesian leaders of PNG, Vanuatu, Fiji, New Caledonia and the Solomon Islands gathered in Vanuatu to sign the Melanesian Spearhead Group (MSG) Constitution. That historic document brought together a significant bloc containing nearly 8 million people in five nations.

I think it is fair to say that Australia has underestimated the significance of the MSG and our desire to act as a bloc. Maybe Australia has put too much emphasis on the Forum Sec, but we can’t create good regional policy under the Pacific Plan until we have an effective sub-regional grouping like the MSG to better represent our own interests.

Now, in the case of Australia and NZ’s trade agenda in the Pacific, the MSG would play a critical role in formulating policy in favour of the Melanesians. Is it any coincidence that Australia and NZ are aggressively pushing their pacific trade agenda now – before the MSG Secretariat starts producing Australia/NZ influence-free policy? Because lets be honest here, both Australia and NZ stand to gain little from a free trade agreement with Polynesia and/or Micronesia. It is Melanesia they want and it is Melanesia that is the justification for their aggressiveness.

I thought it would be interesting to point out here that Australia and Free Trade Agreements (FTAs) seem to not go well together. The Australian Parliamentary Library (APL) released a Background Note analysing Australia’s bilateral FTAs which shows how clearly destructive they have been on the Australian economy. Instead, research suggests that FTAs offer little in the way of trade liberalisation and a shift to more liberal trade policies. Rather, FTAs are used more often to promote other non-economic, diplomatic and regional interests.

That APL report notes:

Of the four FTAs currently in force [Thailand – Aus; Singapore – Aus; Aus – US; Aus – Chile], a common feature has been their impact on trade flows. The FTAs were followed by higher Australian trade deficits and a much slower rate of reciprocal export growth, as well as trade diversion as products were sourced from countries with which Australia has zero tariffs. The potential risks of the current FTA model adopted by Australia are clear: structural trade imbalances leading to higher trade deficits favouring the FTA partner country, long phase-in periods for free trade (in particular agricultural trade), and negative impacts on the Australian economy which are related to trade diversion.

And Australia wants to establish a FTA with the Pacific that is supposed to benefit the Pacific? Well Australia, that’s what they said about the Australia – US FTA and it’s now costing you in the form of a AU$13.6 billion trade deficit (as of 2007)! According to the National Institute of Economic and Industry Research, Australia’s worst case scenario in regard to the Australia – US FTA is a AU$50 billion drain on the Australian economy and a loss of 200,000 jobs!

Dr Grynberg has raised a number of important issues in Part 1 of his special report. It will be extremely interesting to read about what he has to say in the next three. From somebody who has spent 25 years of his life in the Pacific and is classed as one of the region’s most respected trade advisers, his views must be taken into consideration.

If Melanesian leaders commit to the cause, the MSG can become a driving political force within the Pacific region servicing the real needs of our people. There has never been a demand more greater, nor a time more important where the Pacific is making informed decisions free of Australia, NZ, or for that matter, any other foreign influence – than right now. Our people, not Australians or New Zealanders, rely upon it.

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Spanish banks borrowed €85.6 billion ($105.7 billion) from the ECB last month. This was double the amount lent to them before the collapse of Lehman Brothers in September 2008 and 16.5 percent of net eurozone loans offered by the central bank.

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